Estrictamente Privado y Confidencial. INVESTOR MEETINGS ITAU BBA Sao Paulo, Brazil September 2016

Transcription

1 INVESTOR MEETINGS ITAU BBA Sao Paulo, Brazil September

2 AGENDA ILC at a Glance ILC: Value Proposal Closing Remarks Appendix 2

3 ILC AT A GLANCE Mission: We aim to improve the quality of life of our clients, by offering them efficient and accessible services, mainly in the financial and health industries. We favor the creation of value, efficiency and sustainability, guided by the values of our controller, the Chilean Construction Chamber (CChC) Consolidated Net Income LTM* US$99 million AuM as of June 2016 US$52 billion in AFP Habitat and Inversiones Confuturo Risk Rating: AA+ Equity as of June 30 th 2016 US$1.1 billion ROE* 13.0% LTM June 2016 Consolidated Employees 12,900 approximately in Chile and Peru * Excluding the accounting extraordinary effect related to the association of ILC with Prudential in AFP Habitat for US$336,967 thousand 3 3

4 AGENDA ILC at a Glance ILC: Value Proposal Closing Remarks Appendix 4

5 ILC: VALUE PROPOSAL 6 Multiple avenues for consolidation & growth 1 High quality group, focused on non-discretionary industries Health care operation present in under-penetrated market offers higher profitability upside 5 2 Strategical expertise in realizing value Core business in financial services offers steady cash flow & operational know how 4 3 Generating shareholder value through disciplined capital management 5 5

6 1. High quality group, focused on non-discretionary industries 6

7 PENSION NET SALARY GROSS SALARY Estrictamente Privado y Confidencial ILC IS FOCUSED ON NON-DISCRETIONARY INDUSTRIES Pension Funds Pensions Health Insurance Healthcare Providers 10% Mandatory contribution: Fee:1.27% of gross salary Voluntary Savings 7% Mandatory contribution Voluntary additional contribution 0% - 40% Taxes Voluntary contribution Programmed withdrawal Annuity 7 7

8 ILC S TRACK-RECORD IS SUPPORTED BY A SOLID COMPETITIVE POSITION IN THE SECTORS WHERE IT PARTICIPATES FINANCIAL AFP Habitat: #2 Pension fund company in Chile in terms of contributors, affiliates, AuM and voluntary products Inversiones Confuturo: #2 Life insurance company in Chile in terms of AuM and #3 in terms of direct premiums Consalud: #2 Mandatory health insurance in Chile in terms of contributors and #3 in terms of beneficiaries Red Salud: #2 largest inpatient and outpatient network in Chile #1 dental network in Chile HEALTH Source: Superintendencia de Pensiones, AACh, Superintendencia de Salud, Asociación de Clínicas de Chile 8 8

9 2. Strategical expertise in realizing value 9

10 ILC ACTIVELY MANAGES ITS ASSETS TO INCREASE THEIR VALUE, ALWAYS ORIENTED TO ITS LONG TERM VISION ILC starts operations AFP Habitat starts operations in Chile Isapre Consalud starts operations in Chile Red Salud is constituted as a parent Company to manage ILC s healthcare assets Vida Cámara starts operations, focused in the D&S insurance in Chile / ILC completed its first bond issuance ILC successfully opened to market being the larges IPO in Chile AFP Habitat and Vida Cámara starts operations in Peru ILC acquired 67% of Inversiones Confuturo ILC acquired MassMutual s participation in Corpvida ILC acquired 50.9% of Banco Internacional entering the Chilean banking industry ILC and Prudential became partners in AFP Habitat, in order to expand their footprint as a Latam pension player ILC reaches 100% stake in Red Salud and Inversiones Confuturo ILC executed a capital increase in Inversiones Confuturo Inversiones Confuturo acquires 10 shopping centers from Walmart in Chile for US$640 million ILC sells its participation in iconstruye (IT) and announces its intention to sell its stake in Desarrollos Educacionales (schools) to consolidate its presence and focus in the financial and healthcare industries 10 10

11 % 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% % 5.0% 0.0% -5.0% -10.0% 20. 0% 18. 0% 16. 0% 14. 0% 12. 0% 10. 0% 8.0% 6.0% 4.0% 2.0% 0.0% Estrictamente Privado y Confidencial EXAMPLE OF VALUE CREATION: GROWING INVERSIONES CONFUTURO ILC entered the life insurance industry in 2013, through the acquisition of 67% of Inversiones Confuturo (former Corp Group Vida Chile) ILC reached 100% stake in Inversiones Confuturo after three capital increases and the acquisition a remaining participation in June 2016 The rationale behind this transaction is to add another retirement alternative to ILC, besides programmed withdrawals Inv. Confuturo Direct Premiums (M US$) & Market Share Inv. Confuturo AuM (B US$) & Market Share 9.4% 8.1% 8.5% 8.9% 17.0% 16.6% 16.3% 16.0% 15.9% 7.3% LTM June 2016 Net Result Confuturo + Corpseguros (M US$) ROE Inversiones Confuturo (Net Result / Ave. Equity) 10.6% 10.0% % 4.8% LTM LTM FX: CLP$661.37per US$ Source: SVS, AACh % 11 11

12 BEING A HIGH QUALITY GROUP THAT ADDS VALUE REQUIRES STRICT CORPORATE GOVERNANCE STANDARDS The Company is controlled by the Chilean Construction Chamber, a non-profit social entity, which annually elects 6 of the 7 directors of ILC during its Shareholders Meeting International Investors 15.5% Local Investors 17.5% ILC elects Board Members 67.0% ILC s Board of Directors ILC s Management The Chairman is elected for one year, renewable for a second period. Afterwards, he assumes as Vice Chairman and then Director to give continuity to the Board Directors Committee Investment Committee ILC has a Committee of Directors, responsible for reviewing financial information and auditor s reports, related parties transactions, remuneration systems, internal auditing procedures, among others ILC has also an Investment Committee responsible for reviewing financial decisions undertaken by ILC Subsidiary s Board of Directors Subsidiary s Management Each of ILC s subsidiaries has and independent Board of Directors and Management, who maximize the return of its affiliate Other initiatives to enhance ILC s Corporate Governance: Corporate Governance Manual, Ethic Code, Crime Prevention Model, Whistle Blows Channel, Comptroller, Management Control Department, among others 12 12

13 ILC S VALUE GENERATION IS LED BY AN EXPERIENCED BOARD AND MANAGEMENT ALL ACROSS THE COMPANY ILC seeks to maintain a management team with proven experience in every industry where participates First class board members and managements Sergio Torretti C. Chairman Juan Benavides F. Chairman Joaquín Cortez H. Chairman James Callahan F. Chairman Alberto Etchegaray A. Chairman Pedro Grau B. Chairman Kurt Reichhard B. Chairman Pablo González F. CEO Cristián Rodríguez A. CEO Christian Abello P. CEO Mario Chamorro C. CEO Sebastián Reyes G. CEO Marcelo Dutilh L. CEO Felipe Allendes S. CEO 16 years experience 34 years experience 31 years experience 35 years experience 16 years experience 26 years experience 17 years experience results in a solid performance ,9% 3,1% 8,4% 12,3% 11,4% 11,1% 12,4% 0,1% LTM Profit without encaje (US$ million) LTM -8 Net Profit (US$ million) LTM ROE (%) LTM EBITDA Margin (%) ILC enters the subsidiary ILC changes the strategy of the subsidiary 13 13

14 3. Generating shareholder value through disciplined capital management 14

15 Base 100 Estrictamente Privado y Confidencial ILC S VALUE GENERATION RESULTS IN AN ATTRACTIVE DIVIDEND YIELD Since its IPO, ILC has distributed a dividend yield close to 6% annually ILC has a dividend policy that distributes between 60% to 80% of its Distributable Net Income (Ordinary net income profitability of AFP Habitat s encaje corresponding to ILC) RETURN OVER IPSA 6.4% (Since IPO in 2012) DIVIDEND YIELD 26.4% (At IPO s Price in 2012) ROE LTM June % ILC S Share price return over IPSA IPO S PRICE - ILC $7,061 CLOSING PRICE ILC August 2016 $7, ILC IPSA 4,393 IPSA IPSA 4,

16 ILC HAS DELIVERED CONSISTENT RETURNS DURING THE LAST DECADE ILC s added value is reflected in returns of both ordinary and extraordinary net income ILC s Net Income (M US$) and ROE % 50. 0% 45. 0% % % 35. 0% % % 11.3% 22.4% % 19.3% 18.4% % 14.3% % LTM June % 20. 0% 15. 0% 10. 0% 5.0% 0.0% -5.0% Ordinary Net Income (US$ million) Extraordinary Net Income (US$ million) ROE (%) FX: CLP$ per US$ 16 16

17 ILC S DISCIPLINED CAPITAL MANAGEMENT HAS BEEN RECOGNIZED BY RATING AGENCIES Consolidated debt US$ billion ILC s debt US$235 million Consolidated net debt US$485 million ILC s cash US$102 million Rating AA+ Amortization schedule (US$ million) Net financial debt / Total equity 2 Bank Loan N 1 Bond C-Series Bond D-Series 1.20x 1.00x x 0.55x 0.85x 0.43x June 2016 NFD/Equity Cov. D-Series Cov. C-Series ILC s debt breakdown by type (June 2016) Dividend policy by subsidiary (for 6M16) Bonds 25% Banks 75% Distributable Income (US$ million) Dividend Policy (%) ILC s stake in subsidiary (%) Habitat 59 90% 40.3% Red Salud 6 100% 99.9% Consalud 2 100% 99.9% Vida Cámara (5) 100% 99.9% Inv. Confuturo 36 30% 99.9% Banco Internacional 5 30% 50.6% Total

18 4. Core business in financial services offers steady cash flow & operational know-how 18

19 CHILEAN PENSION INDUSTRY SHOULD GROW DUE TO DEMOGRAPHIC AND ECONOMIC FACTORS Population in age to work / retired (Th.) Retirement Alternatives Comparison Programmed Withdrawal Annuity 1,738 2,075 2,499 3,049 Pension Payment Period Limited Unlimited Funds Ownership From the pensioner From the insurance company Chance of inheriting savings Yes No 10,495 11,269 11,841 12, Mayores Older than de 60 En In age edad to de work trabajar Pension Amount Variable Fixed Chilean GDP per capita (PPP, US$) Number of Programmed Withdrawal and Annuity in SCOMP* participants (Th.) 22,316 18, ,407 7,339 9,849 12, Retiro Programmed Programado Withdrawal Renta Annuity Vitalicia * SCOMP: Sistema de Consultas y Ofertas de Monto de Pensión. System that provides information regarding the different retirement alternatives for pensioners in Chile Source: Superintendencia de Pensiones, Banco Mundial, INE 19 19

20 Average Taxable Income (US$) AuM (Billion US$) Estrictamente Privado y Confidencial AFP HABITAT: ESTABLISHED COMPANY WITH A SOLID MARKET POSITION AND PERFORMANCE, EXPANDING INTO PERU Since March 2016 ILC is associated with Prudential Financial Inc. in AFP Habitat, maintaining 40.3% of the property each AFP Habitat is consolidating its position in the high income segment in Chile, through an efficient operating model The Company is expanding its greenfield presence in Peru, were operates the auction for new affiliates in the private pension system (PPS) Average taxable income in Chile SG&A over AuM in Chile (LTM, June 2016) Average Taxable Income Industry Additional Taxable Income AFP Habitat June ,0 45,0 40,0 35,0 30,0 25,0 20,0 15,0 10,0 5,0 Provida Habitat Cuprum Capital Planvital Modelo - 0,00% 0,10% 0,20% 0,30% 0,40% 0,50% 0,60% 0,70% 0,80% SG&A over AuM (%) #2 Player in Chile in terms of contributors, affiliates, AuM and voluntary Products as of December 2015 #1 in annual returns for all funds as of June 2016 FX: CLP$ per US$ Source: Superintendencia de Pensiones Chile 20 20

21 AuM (Million US$) 1 Auction new affiliates into the Peruvian PPS 2 Auction Estrictamente Privado y Confidencial AFP HABITAT: ESTABLISHED COMPANY WITH A SOLID MARKET POSITION AND PERFORMANCE, EXPANDING INTO PERU Affiliates & Market Share AFP Habitat Peru SG&A over AuM in Peru (LTM, June 2016) Integra Prima Profuturo Larger scale ,0% 5,0% 10,0% 15,0% 20,0% Habitat Jun16 Habitat '15 Habitat '14 SG&A over AuM (%) AFP Habitat started greenfield operations in Peru, through the first auction for new affiliates into the Peruvian PPS in 2013 AFP Habitat has the lowest fee in the industry, with 0.38% over contribution and 1.25% over AuM FX: PEN$3.287 per US$ Source: Superintendencia de Pensiones Perú, INEI Perú, INE Chile #1 in annual returns in all funds as of June 2016 Peruvian pension funds industry presents an attractive perspective due to its large population of 31 million (vs. 17 million in Chile), and the low labor formality rate which is close to 30% (vs. 85% in Chile) 21 21

22 INVERSIONES CONFUTURO: CONSOLIDATING ITS FOOTPRINT AS AN ANNUITY MARKET LEADER IN CHILE The Company aims to strengthen its operational and financial performance in the annuity market, being a good alternative to the programmed withdrawal retirement Annuity Market Share (June 2016, Direct premiums) Leverage Evolution Others 27.3% Consorcio 18.0% Metlife 15.2% US$2.2 Billion Inv. Confuturo 16.7% Bice 9.0% Penta Vida 13.8% Result on Investments / Investment Portfolio June 2016 Confuturo Corpseguros Investment portfolio breakdown by Instrument 5.5% 5.3% 5.3% 3% 4% 5% 6% 8% 11% 13% 14% 15% 15% 4.9% 4.6% 4.3% 4.8% 4.6% 4.1% 4.2% 81% 79% 78% 75% 73% 5% 4% 3% 3% 3% LTM June June 2016 Confuturo Corpseguros Equity Fixed Income Real Estate Others Annuity / Programmed withdrawal preference (Chile, 2015): ~ 70% / 30% FX: CLP$ per US$. Source: Aseguradores de Chile, SVS, Superintendencia de Pensiones Chile Inv. Confuturo s Annuity Premiums 6M16 (% Total): ~85% of total Premiums 22 22

23 CHILEAN BANKING INDUSTRY IS STILL UNDERPENETRATED COMPARED TO DEVELOPED COUNTRIES The Chilean banking industry is composed by 24 banks (local and foreign) Commercial loans have shown a significant growth during the last five years (CAGR = 13.4%) Bank loans / PIB (%) 400% Mortg. 27% Commercial 60% 300% Consumption 13% US$ 220 Bn. Japan Banking System in Developed Countries Banking System in Developing Countries Spain USA 200% UK 100% South Africa Chile India Colombia Russia Italy France Germany Australia Peru Mexico 0% GDP per capita (US$ PPA) Source: World Bank (2014), SBIF FX CL$ / US$ 23 23

24 ROE Estrictamente Privado y Confidencial BANCO INTERNACIONAL: FOCUSED ON GENERATING MARKET RETURNS ILC controls Banco Internacional, Factoring Baninter and Baninter Corredora de Seguros since October 2015 Banco Internacional has a global market share of 0.6% and 1.0% in terms of total and commercial loans respectively The Company aims to strengthen its operational, commercial and risk performance, in order to reach industry returns Banco Internacional should strengthen its position in the small and medium size companies Second Chilean bank in terms of capitalization ratio as of December 2015 Chilean Bank Industry: ROE & Loans 30% 25% 20% 15% 10% Retail Falabella Ripley Consorcio HSBC Medium Size Bice Security I nternacional June '16 Large Size Scotiabank BBVA Estado BCI Chile Santander 5% Itaú-Corpbanca I nternacional '15 0% Loans (US$ Billion) Universal ROE Evolution Banco Internacional Loans Breakdown (June 2016) 16.8% 18.0% 18.6% 15.2% 17.5% 12.9% 14.7% 14.8% 17.2% 14.3% 12.1% 1.3% 3.7% 3.0% 0.1% 8.4% Commercial 96.9% US$1.3 Billion Personal Consumption 0.7% LTM June 2016 Mortage 2.4% Banco Internacional Industry Figures as of June FX: CLP$ per US$. Source: Superintendencia de Bancos e Instituciones Financieras 24 24

25 5. Health care operation present in under-penetrated market offers higher profitability upside 25

26 Per capita health expenditure (US$/hab.) Estrictamente Privado y Confidencial CHILEAN DEMAND FOR HEALTHCARE SHOULD INCREASE DUE TO ECONOMIC DEVELOPMENT AND LIFESTYLE United States Mexico Turkey 2 X Nueva Zeland Spain Portugal Greece Slovenia Korea Hungary Czech Rep. Israel Slovak Rep. Estonia Poland Netherlands Germany Sweden Belgium Austria France Canada Denmark Japan Iceland Australia Finland Ireland Italy United Kingdom Switzerland Norway Per capita GDP (US$/hab.) Risk Factors Older Population Diabetes (% hab years) 6.5% 6.9% 9.6% 9.8% 10.4% 15.9% 22% 9% 91% CHILE % Obesity (% hab.> 15 years) 16.6% 17.5% 19% 25.1% 32.4% 35.3% 27% 15% OECD % 73% % of population aged less than 65 % of population aged 65 and over Tobacco (% hab.> 15 years) 11.3% 11.8% 13.7% 19.7% 23.9% 29.8% Source: Health at a Glance 2013,

27 CHILE PRESENTS A LACK OF HEALTH INFRAESTRUCTURE AND SPECIALISTS COMPARED TO OTHER DEVELOPED COUNTRIES Doctors (Every 1,000 habitants) Nurses (Every 1,000 habitants) 3,81 3,27 11,14 9,09 2,56 2,16 1,88 1,84 5,63 5,14 2,62 1,49 Beds (Every 1,000 habitants) MRI Equipment (Every 1,000,000 habitants) 4,84 43,48 37,76 2,96 2,93 24,43 2,32 2,17 1,61 17,59 12,30 8,94 5,31 Source: Health at a Glance

28 AVANSALUD TABANCURA BICENTENARIO MEGASALUD % 12% 10% 8% 6% 4% 2% 0% 16% 14% 12% 10% 8% 6% 4% 2% 0% 19% 19% 18% 18% 17% 17% 16% 16% 15% 20% 10% 0% -10% -20% -30% -40% Estrictamente Privado y Confidencial RED SALUD IS ONE OF THE LARGEST CHILEAN HEALTHCARE NETWORKS, WITH 11 HOSPITALS AND 31 OUTPATIENT CENTERS Occupancy Rate Revenues (M US$) and EBITDA Margin Main Focus for 2016 Outpatient services 13 % 12 % 12 % 12 % 9% 8% Red Salud s operational performance has been impacted by the important investment plan undertaken during the last 5 years for approximately US$300 million Inpatient & Outpatient services / Santiago 68.6% LTM 14% 13 % 13 % 11% 9% 6% Since end-2015 Red Salud reinforced its focus and strategy into one oriented to costefficiency and profitability. The latter is based on: Inpatient & Outpatient services / Santiago 83.8% LTM 19 % 18% 18% 17% 17% 17% Management Network Investments LTM Inpatient & Outpatient services / Santiago % % 6% % 14% 67.0% LTM -3 9% 28 28

29 25,00 20,00 15,00 10,00 5, % 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Estrictamente Privado y Confidencial ILC PROVIDES MANDATORY AND SUPPLEMENTAL HEALTH INSURANCES THROUGH CONSALUD AND VIDA CAMARA Consalud has been impacted by a pronounced deterioration in margins due to a higher frequency and cost per beneficiary Market Share (Contributors) Total: 1.9 M Direct costs / Revenues Consalud 20.0% Consalud Colmena 17.0% Banmédica 82.8% 84.7% 84.2% 88.2% 89.1% Banmédica 19.8% Cruz Blanca Masvida Cruz Blanca 21.5% M16 Trials due to adjustments in contract s base price Masvida 16.7% Colmena Vida Tres Optima 4.0% 1.1% Vida Camara Beneficiaries Evolution (Th.) N Trials against Consalud Adjustment Base Price (%, real) 7.5% 5.4% 3.9% 2.9% 2.3% 4,156 9,760 12,156 19,181 11, M16 Consalud has developed complementary products to attract new contributors June Source: Superintendencia de Salud 29 29

30 6. Multiple avenues for consolidation & growth 30

31 2016 HAS BEEN MARKED BY MILESTONES THAT CONSOLIDATE ILC S PRESENCE IN THE FINANCIAL AND HEALTHCARE INDUSTRIES Capitalization and consolidation of subsidiaries: Banco Internacional (US$100 million) Red Salud (US$23 million) Inversiones Confuturo (US$150 million) 1 Proceeds from association with Prudential in AFP Habitat US$370 million Return value to shareholders through an extraordinary dividend 2 Position AFP Habitat as a leader company in the Latam pension fund industry

32 BASED ON S FOCUSES, ILC HAS SEVERAL OPPORTUNITIES: AFP Habitat: Consolidate its association with Prudential Strengthen its regional footprint in Chile and Peru Inversiones Confuturo: Maintain its leadership in the growing annuity industry Further improve returns on investments, maintaining an adequate leverage Banco Internacional: Vida Camara: Consalud: Improve operational and administrative efficiency Focus in medium and small size companies Consolidate its new Management Team Consolidate in Supplemental Health Insurances Red Salud: Improve operational efficiency and synergies between the network Further improve efficiencies in costs and SG&A Continue developing innovative complementary products Consolidate its new Management Team 32 32

33 AGENDA ILC at a Glance ILC: Value Proposal Closing Remarks Appendix 33

34 INVESTMENT HIGHLIGHTS Estrictamente Privado y Confidencial One of the largest Asset Managers in Latam Consolidated controlling shareholder Demonstrated trackrecord in nondiscretionary industries Solid and stable credit risk rating Proven access to capital markets Attractive and consistent dividend yield 34 34

35 AGENDA ILC at a Glance ILC: Value Proposal Closing Remarks Appendix 35

36 SUMMARIZED FINANCIAL STATEMENTS AND SUBSIDIARIES FIGURES Balance Sheet Th. US$ June 2016 June 2015 Variation NON-I NSURANCE ACTI VI TY ASSETS % Total Current Assets % Total non current assets % TOTAL I NSURANCE ACTI VI TY ASSET % TOTAL BANKI NG ACTI VI TY ASSETS % TOTAL ASSETS % 0 0 NON-I NSURANCE ACTI VI TY LI ABI LI T % Total current liabilities % Total non current liabilities % I NSURANCE ACTI VI TY LI ABI LI TI ES % BANKI NG ACTI VI TY LI ABI LI TI ES % TOTAL LI ABI LI TI ES % Equity attributable to owners of the parent co % Non-controlling interests % TOTAL EQUI TY % TOTAL LI ABI LI TI ES AND SHAREHOLD % I ncome Statement Th. US$ June 2016 June 2015 Variation NON-I NSURANCE ACTI VI TY Operating result % Non operating result 239 (15.279) -102% Profit (loss) before tax (2.422) -625% Profit (loss) from discontinuing operations % Non-I nsurance activity profit % I NSURANCE ACTI VI TY Operating result % Non operating result (15.107) % Profit (loss) before tax % I nsurance activity profit % BANKI NG ACTI VI TY Operating result Non operating result 21 - Profit (loss) before tax Banking activity profit PROFI T (LOSS) FOR THE PERI OD % Profit attributable to owners of the pa % Profit attributable to non-controlling in % I ndividual Results (LTM June 2016, Th. US$) AFP Habitat Co nfuturo Co rpseguro s Banco I nternacio nal Red Salud Co nsalud Vida Camara I ndustry Pensio n Funds Life I nsurance Life I nsurance Bank Healthcare Mandato ry health Vo luntary health Pro vider insurance insurance Revenues 242, , ,300 70, , , ,987 EBI TDA / EBI TDAE 149, ,329 5,658 - Net I nco me 122,885 10,758 39,978 6,018 8,681 1,543 (4,543) Assets 536,048 4,750,562 3,471,237 1,996, , , ,607 Liabilities 113,593 4,439,877 3,195,039 1,853, , , ,812 Equity 422, , , , ,867 12,323 51,795 % o wnership I LC 40.3% 99.9% 99.9% 50.6% 99.9% 99.9% 99.9% Market Capitalizatio n (U$ billio n) Figures as of June 2016 / FX: CLP$ per US$ 36 36

37 SUMMARIZED FINANCIAL STATEMENTS AND SUBSIDIARIES FIGURES US $ Th. 6M16 6M15 % Revenues 125, , % SG&A (51,481) (48,651) 5.8% Operati ng Res ul t 73, , % Profitability of the encaje 3,483 15, % Non-operati ng Res ul t 6,812 18, % Net Income 6 2, , % EBITDAE 78,746 70, % Δ+ revenues +1.6% (real terms) of the average salary quoted by Habitat in Chile + 53% affiliates in Peru Δ+ SG&A +5.3% in personnel expenditures +3.8% in other operational expenses such as marketing, IT and administration Δ- 78% profitability of the encaje US $ Th. 6M16 6M15 % Revenues 291, , % Cost of Sales (259,958) (229,475) 13.3% SG&A (39,430) (36,878) 6.9% Operati ng Res ul t (5,511) 5, % Non-operati ng Res ul t 1,418 1, % Uti l i dad IFRS (2,2 81) 4, % Uti l i dad FEFI 1,573 6, % EBITDA (1,767) 8, % Δ+ revenues +2.8% in contributors, +4.2% inflation, and larger contribution cap Δ+ costs Higher loss ratio related to outpatient, inpatient and temporarily disability insurances Δ+ SG&A +16% trials against Consalud y-o-y Figures as of June 2016 / FX: CLP$ per US$ 37 37

38 SUMMARIZED FINANCIAL STATEMENTS AND SUBSIDIARIES FIGURES US $ Th. 6M16 6M15 % Non Ins urance Acti vi ty Res ul t (5,444) (6,2 44) -12.8% Premiums Net Income 399, , % Result from Investments 197, , % Cost of sales (540,024) (448,737) 20.3% SG&A 5,927 (9,460) % Operati ng Res ul t 6 2,573 44, % Non-operati ng Res ul t (14,53 0) 1, % Ins urance Acti vi ty Res ul t 41, , % Δ+ revenues +30% due to regulatory changes in the discount rate for accounting annuities, as well as by the resources (US$80 million) injected by ILC as capital increases Flat result on investments due to higher liquidity to acquire shopping centers from Walmart (US$640 million) Net Income 3 5, , % US $ Th. 6M16 6M15 % D&S Chile (11,570) (9,752) 18.6% D&S Peru 2,364 0, % Life and Supplemental Health Insurance Chile 5,853 4, % SG&A (4,761) (4,429) 7.5% Operati ng Res ul t (8,02 1) (8,807) -8.9 % Non-operati ng Res ul t % Net Income (4,546 ) (6,9 51) % Δ+ gross result Life and supplemental health Insurances: increase in beneficiaries and premiums D&S Chile: higher loss ratio D&S Peru: release of reserves from the previous contract and a better reinsurance of the current tender Figures as of June 2016 / FX: CLP$ per US$ 38 38

39 SUMMARIZED FINANCIAL STATEMENTS AND SUBSIDIARIES FIGURES US$ Th. 6M16 6M15 % Revenues 248, , % Cost of Sales (189,987) (147,357) 28.9% SG&A (40,284) (29,706) 35.6% Operati ng Res ul t 18, , % Non-operati ng Res ul t (9,19 9 ) (6,809 ) 3 5.1% Net Income 6, % EBITDA 30,823 19, % EBITDA Margin 12.4% 10.7% 1.7% Δ+ operating result Higher activity in all healthcare units Cost reduction in all healthcare units in Santiago (as a % of revenues) Δ+ EBITDA margin Red Salud: from 10.7% in 6M15 to 12.4% in 6M16 Clínica Bicentenario: from 10.0% in 6M15 to 15.3% in 6M16 Megasalud: from 7.3% in 6M15 to 12.5% in 6M16 US$ Th. 6M16 Revenues 35,382 SG&A (23,085) Credit risk provisions (6,151) Operati ng Res ul t 6,147 Non-operati ng Res ul t 21 Net Income 5,450 Better results arise mostly from risk management actions Increase in commercial loans Annualized ROE of 8.4% Figures as of June 2016 / FX: CLP$ per US$ 39 39

40 IN 2015 CHILEAN PENSION FUNDS REPRESENTED 71% OF TOTAL GDP Market Players (100% private) Fee (% on gross salary, capped at US$2,642) 1.27% 0.47%* 0.77% 1.44% 1.48% 1.54% Taxable Income (Average, US$) US$ 888 US$662 US$809 US$797 US$ 1,593 US$642 Affiliates 10 Million Annual Contributors 5.6 Million Pensioners 1.3 Million 32.6% % 30.8% % 36.8% % % % % 27.4% % AuM US$154 Billion % 26.2% % 2.1% % Invested in: 16.6% 15.0% D 8.8% % % * 97.2% correspond to dependent workers. Distribution of assets in the Industry by type of fund E A 15.3% B 16.1% With a return of: 4.03% 3.79% 5 7.9% 2.88% 2.75%.2,49% 2.16% % 5.4% Return of funds in the last 12 months (real terms) 2.40% 2.02% HABITAT INDUSTRIA NDUSTRY 0.84% 0.70% 21.3% % *Planvital s fee decreased to 0.41% as of August 2016 E Less risk C 37.0% A More risk A B C D E FX: CLP$ per US$ 40 Source: Superintendencia de Pensiones 40

41 97% OF CHILEAN POPULATION IS COVERED BY HEALTH INSURANCES, OF WHICH 75% IS MANAGED BY THE PUBLIC SECTOR (FONASA) Supporter (7% on taxable salary, capped at aprox US$3,000; with an average contribution of 10% in the case of Isapres) Government Insurer Isapre Fonasa Others Total Beneficiaries 3.3 MM Total Beneficiaries 13.5 MM Total Beneficiaries 1.1 MM Banmédica 20,7% Consalud 20,7% Armed Forces Chilean Army Masvida 16,8% Optima 0,6% Vida Tres 4,3% Cruz Blanca 20,9% Colmena 15,9% Chilean Navy Chilean Air Force Chilean Police Market share at the level of beneficiaries to open Isapres A - B C - D Provider Private sector, according to chosen plans with Isapres Public sector Public sector and some private providers Private sector, according to chosen plans with Isapres Market Players (Private and open) Average Contribution (Annual, US$) Loss Ratio * E A $ 1,696 $ 2,454 $ 2,121 $ 2,960 $ 1,869 $ 2,007 D B $ % 86.9% 84.9% 85.7% 56.6% 89.2% 87.9% C FX: CLP$ per US$ * In November 2014 Ferrosalud changed its name into Óptima Source: Superintendencia de Salud, statistics 2014 Dimensionamiento del Sector de Salud Privado en Chile

42 THE PRIVATE HEALTHCARE SYSTEM PLAYS AN IMPORTANT ROLE TO MEET CHILEAN DEMAND FOR HEALTH Total Health Expenditure 8.8% of GDP Doctors ~ 30 thousands Geographic Distribution of Doctors in Chile Hospitals and Clinics ~ 350 Public 54% Public 48% Geriátric and Psiq. Clinics 11.5% Others 8.6% 53.7% Public Hospitals Private 46% Private 52% North 2,418 doctors 83.7 habitants by doctor Mutuals 3.4% Private Clinics 22.7% Center 21,899 doctors 47.1 habitants by doctor Red Salud: 11 private clinics Nurses ~99 thousands Public 54% Dentists ~ 16 thousands Public 30% South Center 4,415 doctors 75.7 habitants by doctor South 1,264 doctors 85.1 habitants by doctor Geriatric and Psiq. Clinics Mutuals Private Clinics 2% 4% 18% Beds ~ 38 thousands Others 10% 66% Public Hospitals Private 46% Private 70% Red Salud: 858 beds 42 Source: Dimensionamiento del Sector de Salud Privado en Chile 2014 Health at a Glance

43 ILC PARTICIPATES IN THE LIFE INSURANCE INDUSTRY, FOCUSING ON ANNUITIES Life Insurances Direct premiums: BUS$ companies General Insurances Direct premiums : BUS$ companies Traditional (Collective) BUS$0.7 Others 28% Pension BUS$4.3 15% 9% Others Others D&S Individuals (B US$1.1) Bank Insurances and Retail B US$1.0) Others 31% Fire 12% Vehícles 22% Natural Disasters 22% Transport 4% Liability 10% Health 72% Annuities 76% AuM/Average Direct Premium 180 Health Direct Premiums MUS$480 Annuities Direct Premiums BUS$4.3 22% 13% 13% 11% 9% 32% 17% 16% 16% 11% 10% 30% Otros Otros Source: AACH Average Premium Th.US$ Vida Cámara Ohio Nacional Renta Nacional Sura EuroAmérica Corpseguros Penta Vida Principal Confuturo Consorcio Nacional Bice Vida Security Previsión AuM Chilena Consolidada Metlife MUS$

44 Disclaimer: This document provides information about ILC Inversiones S.A. In any case this constitutes a comprehensive analysis of the financial, operational and sales situation of the Company, so to evaluate whether to purchase or sell securities of the Company, the investor must conduct its own independent analysis. In compliance with the applicable rules, ILC Inversiones S.A. publishes this document in its web site ( and submits to the Superintendencia de Valores y Seguros, the financial statements of the company and its corresponding notes, which are available for consultation and review. Contact Information: Trinidad Valdés / IR Department / / tvaldes@ilcinversiones.cl / Camila Tagle / IR Department / / ctagle@ilcinversiones.cl / 44